Beruflich Dokumente
Kultur Dokumente
INSURANCE POLICIES
By
KAMAL DEV
80906317024
2008-10
CONTENTS
1.CONTENTS…………………………………………………………………
2.ACKNOWLEDGEMENT……………………………………………….…
3.EXECUTIVE SUMMARY…………………………………………………
4.INTRODUCTION…………………………………………………………..
A. FUNCTION OF INSURANCE………………………………...…..
B. INDUSTRY PROFILE………………………………………..…..
C. ENERGENCE IN INDIA…………………………………………
D. INSURANCE SECTOR REFORMS IN INDIA………………...
E. REGULATION…………………………………………………….
F. PRIVATIZATION OF INDIAN INSURANCE INDUSTRY…....
G. PERFORMANCE AFTER PRIVATIZATION…………………..
H. BENEFITS OF LIFE INSURANCE…………………………….…
I. FUTURE PERSPECTIVE………………………………………….
6. REVIEW OF LITERATURE…………………………………………....
A. OBJECTIVE…………………………………………………….…..
B. BENEFITS………………………………………………………..…
7. RESEARCHMETHODOLOGY……………………………………..…….
A. LIMITATION………………………………………………….…….
B. DATA ANALYSIS……………………………………………..…….
8. FINDING AND CONCLUSIONS…………………………………………
9. RECOMMENDATION…………………………………………………….
10. BIBLIOGRAPHY…………………………………………………………..
11. ANNEXURE……………………………………………………………...…
ACKNOWLEDGEMENT
The project has been undertaken at Shimla (H.P) and it has given me an invaluable
insight in the study of the insurance sector. This project has helped me to know
about the “Analysis of the insurance solution provided by the various players”.
At this very outset, I sincerely acknowledge with gratitude the guidance and
support rendered to me by different people without which this project would not
eve materialized.
Satish Kumar
INTRODUCTION
Primary functions
1 Provides protection: insurance cannot check the happening of risk but can
provide for losses of risk.
2 Collective bearing of risk: insurance is a device to share the financial losses
of few among many others.
3 Assessment of risk: insurance determines the probable volume of risk by
evaluating various factors which give rise to risk.
4 Provide certainty: insurance is a device which helps to change from
uncertainty to certainty.
Secondary functions
INDUSTRIAL PROFILE
HISTORY OF INSURANCE
Milestones
1 By the middle of the 14th century marine insurance was practically universal
among maritime nation of Europe.
2 In London, Lloyd’s Coffee House (1688) was a place where merchants, ship
owners, and underwriters met to transact business.
3 By the end of the 18th century Lloyd’s had progressed in to one of the first
modern insurance companies.
4 In 1693 the astronomer Edmond Halley constructed the first mortality table,
based on the statistical laws of mortality and compound interest.
5 The table corrected (1756) by Joseph Dodson, made it possible to scale the
premium rate to age; previously the rate has been same for all ages.
6 The first stock company to engage in insurance were chartered in 1720, and
in 1735, the first insurance company in the American colonies was founded
at Charleston, S.C.
7 Fire insurance corporations were formed in New York and Philadelphia.
8 The Presbyterian Synod of Philadelphia sponsored (1759) the first life
insurance corporation in America, for the benefit of Presbyterian ministers
and their dependents.
9 The New York called for the attention to the need for adequate reserves to
meet unexpectedly large losses. Massachusetts was the first state to require
company by law to maintain such reserves.
10 The great Chicago fire (1871) emphasized the costly nature of fires in
structurally dense modern cities. Reinsurance, whereby losses are distributed
among many companies, was devised to such situations and is now common
in other lines of insurance.
11 The workmen’s compensation act of 1897 required employer to insure their
employees against industrial accidents.
12 Public liability insurance, fostered by legislation made its appearance in the
1880’s, it attained major importance with the advent of automobile.
Insurance developed rapidly with the growth of British commerce in the 17th and
18th century. Prior to the formation of corporations devoted solely to the business
of writing insurance, policies were signed by number of individuals each of them
write his name and amount of risk he was assuming underneath the insurance
proposal, hence the term underwriter.
Insurance in modern form originated in Mediterranean during 13th & 14th century.
The oldest and earliest records of insurance comes in form of marine insurance
where ships and cargo were insured against the perils such as pirates, storms,
mutiny and wars.
EMERGENCE IN INDIA
The insurance sector in India has come a full circle from being an open
competitive market to nationalization and back to a liberalized market again.
Tracing the developments in the Indian insurance sector reveals the 360 degree
turn witnessed over a period of almost two centuries.
Life Insurance in it’s existing form came to India from United Kingdom (UK) with
the establishment of British Firm – Oriental Life Insurance Company in Calcutta in
1818, the Madras Equitable Life Insurance Society in 1829. Prior to 1871, Indian
lives were treated as sub-standard and charged an extra premium of 15% to 20%.
Bombay Mutual Life Assurance Society, an Indian insurer that came into existence
in 1871, was the first to cover Indian lives at normal rates.
Post 1947 India had a great challenge to come out of dark into an era where many
countries were happily progressing on the way of advancement. Besides the
infrastructure is required to develop the nation industrially, the young nation also
had to build security at all levels among the citizens of the nation, who had
witnessed the painful partition.
The socialist pattern of government was adopted thus government nationalized a
number of operations that were important for the development of the economy and
the social health of the economy and social health of the nation. Insurance was one
such industry that saw industrialization in year1956. Prior to this insurance sector
had some 256 companies in the insurance sector. The life insurance corporation
was formed and all other insurance companies gave their business to the
corporation. The basic intention was to take the concept of insurance to the grass
root level of Indian society.
INSURANCE SECTOR REFORMS IN INDIA
The reforms were aimed at “creating a more efficient and competitive financial
system suitable for the requirements of the economy keeping in mind the structural
changes currently underway and recognizing that insurance is an important part of
the overall financial system where it was necessary to address the need for similar
reforms…”
In 1994, the committee submitted the report and some of the key recommendations
included:
Structure
Competition
1 Private Companies with a minimum paid up capital of Rs.1bn should be
allowed to enter the industry.
2 No Company should deal in both Life and General Insurance through a
single entity Foreign companies may be allowed to enter the industry in
collaboration with the domestic companies.
3 Postal Life Insurance should be allowed to operate in the rural market.
4 Only one State Level Life Insurance Company should be allowed to operate
in each state.
Regulatory Body
Customer Service
1 LIC should pay interest on delays in payments beyond 30 days
2 Insurance companies must be encouraged to set up unit linked pension plans
3 Computerization of operations and updating of technology to be carried out
in the insurance industry
The committee emphasized that in order to improve the customer services and
increase the coverage of the insurance industry should be opened up to
competition. But at the same time, the committee felt the need to exercise caution
as any failure on the part of new players could ruin the public confidence in the
industry.
Hence, it was decided to allow competition in a limited way by stipulating the
minimum capital requirement of Rs.100 crore. The committee felt the need to
provide greater autonomy to insurance companies in order to improve their
performance and enable them to act as independent companies with economic
motives. For this purpose, it had proposed setting up an independent regulatory
body.
INSURANCE ON THRESHOLD
The decades that followed saw the world economy changing and going through a
major shift. There was rapid technological development onus shifted to
computerization and in Indian context the change that the world was witnessing
was not occurring. The country still ran on the socialist pattern and the “license
raj” ruled the economy. In India insurance was being sold on the basis of tax
benefits that the government allowed. The consumer, who was heavily taxed,
sought insurance as an eligible tool to cover his tax liabilities.
In 1993, post liberalization it was realized that the insurance plays a very vital role
in the development of the new economy. It is also very important social security
tool and the money collected through insurance was instrumental in developing the
nation.
The Malhotra committee was formed to this and it suggested that insurance sector
should be allowed to enter the market with foreign participation.
The liberalization of Indian insurance sector has been the subject of much heated
debate for some years. The policy makers were in catch 22 situation where they
wanted competition, development and growth of insurance sector which is
extremely important for channeling the investments in infrastructure. At the other
end the policy makers had the fear that the insurance premium which are
substantial will seep out of the country and thus wanted to have the cautious
approach of opening for foreign participation in the sector.
In 1999 insurance development act was formed and from July1, 2000 private
players entered the market. Despite innumerable delays the insurance sector was
finally opened for private competition. The number of potential buyers of
insurance is certainly attractive but much of this population might not be
accessible. New insurers must segment the market carefully so as to provide
appropriate products at appropriate prices and through proper distribution channel.
India has an enormous middle class that can afford to buy life, health and pension
plan products. The low level of penetration of life insurance in India compared to
other developed nations can be judged by a comparison of per capita life premium.
This has made insurance the hottest sector after IT. With social security and
security of the public at large being the agenda for opening the sector, the role of
the regulator becomes all the more serious and one that would be carefully watched
at every step.
INVESTMENT CRITERIA
It was decided that life insurance would have to invest 25% in the government and
other 25% in another approved securities, 15% investment will have to be invested
in infrastructure sector and in social sector. The balance 35% will be available to
the companies to invest in capital markets where the return on investment is
significantly higher.
Rural sector
The criteria for investment in rural sector for life insurance companies is the
following % of the total policies written in the corresponding financial year, 5% in
the first financial year, 7% in the second financial year, 10% in the third financial
year, 12% in the third financial year, 15% in the fifth financial year.
There is no doubt that market for insurance products in India is significant and
offers a great scope for growth.
First, while estimating the potential of Indian insurance market we often attempt to
look at it from the perspective of macro economic variables such as ratio of
premium to GDP, which is indeed comparatively low in India. For example India’s
life insurance premium as a percentage of GDP is 1.3$% against 5.2% of US, 6.5%
of UK or 8% in South Korea. But the fact is that the number of potential buyers of
insurance is certainly attractive. However, there are also difficulties in approaching
this population because of poor distribution, large distances or high costs relative
to returns.
Secondly, most new entrants have the tendency to target the business of existing
companies rather than expanding the market, this is myopic. This not only leads to
intense competition for new players and much of their time is spent to capture
existing customers by offering better services or advantages. Yet, the benefit of the
strategy is limited. A better approach could be to examine the niches where
demand can be met or stimulated.
REGULATION
Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in
Parliament in December 1999. The IRDA since its incorporation as a statutory
body in April 2000 has fastidiously stuck to its schedule of framing regulations and
registering the private sector insurance companies.
The other decision taken simultaneously to provide the supporting systems to the
insurance sector and in particular the life insurance companies was the launch of
the IRDA’s online service for issue and renewal of licenses to agents. The approval
of institutions for imparting training to agents has also ensured that the insurance
companies would have a trained workforce of insurance agents in place to sell their
products.
Since being set up as an independent statutory body the IRDA has put in a
framework of globally compatible regulations. In the private sector 12 life
insurance and 6 general insurance companies have been registered. To regulate,
promote and insured orderly growth of the insurance business and re-insurance
business, a regulatory authority - Insurance Regulatory and Development
Authority (IRDA), was set up under IRDA Act, 1999.
The retention of premium in India has become a critical issue with some people
who demand that the present outgo of 10 billion by the way of reinsurance be
stopped. These people in the name of safeguarding the national interest are in fact
compromising the interest of the nation. If no reinsurance is applied it means that
insurance company is under writing the entire risk itself. Thus the single
earthquake or storm can wipe out the entire company.
The insurance sector is a service industry and international companies will help
build local professionals with world class expertise by introducing the best global
expertise. Competition will also develop a better understanding of consumer
requirements leading to more customized products apt for market place. Besides it
would also improve the tertiary sector tremendously. Development of tertiary
sector would include new avenues for actuaries, accountants, stockbrokers and
others. Thus we can say that opening up of insurance sector would bring about
sweeping changes not only for consumers but also for economy as a whole.
PRIVATIZATION OF INDIAN INSURANCE INDUSTRY
So far, India's insurance market has been shaped almost entirely by the state owned
insurers, led by the old life Insurance Corporation of India in the life segment and
General Insurance Corporation in the non-life one. It is only recently that beam
market opened to competition from insurance, almost all of them 74 : 26 joint
ventures between Indian and foreign firms, under the watchful eye of the IRDA of
India.
Though a doubtful starter, insurance industry was ultimately opened up this year
for private players like reliance, Tata and Bajaj to provide consumers more choice
while generating the mart in need long term funds for moving over to a higher
growth path.
To catalyze the process, the government notified IRDA Act, allowing 26% foreign
holding in the Indian venture and also allowed foreign direct investment in the
sector through the automatic route. But leaving apart the few manufacturing
monoliths, most of the new and entrants, ICICI Prudential life Insurance company,
HDFC Standard life Insurance, Max New York life, OM Kotak Mahindra, Royal
Sundram, Tata AIG., Birla Sunlife and ING Vysya are from the financial sector
itself.
Life Insurers:
Indian life insurance industry has suddenly witnessed a major boom. Hailed as a
successful case of privatization, the sector holds many more hopes and surprises
for both insurers and consumers. Asia Insurance Post takes stock of new
development. Smashing doubts over the decision to liberalize the industry, the
overwhelming first-year performance of the Indian insurance sector is test case of a
massive success story of private players entering into the erstwhile state monopoly.
It beats the privatization of The Telecom Sector and the Banking Industry.
ICICI Prudential Life Insurance Company, noted as the number one private life
insurer, scored on all three fronts with the maximum number of policies sold
(1,00,000), highest amount of premium collected (Rs. 122 Crore) and greatest
amount of business written (Rs. 2700 Crore).
Max New York Life Insurance Company scored second place with Rs.43 crore
premium income received on 64,000 whole-life policies sold. It has built a
business to the tune of Rs. 2,100 Crore in its first year of operations. It invests only
in debt instruments and meets both Indian and international disclosure norms. The
Company's paid up capital is Rs.387 crore, which makes it among the highest
capitalised life insurer in India. New York Life has grown to be a Fortune 100
company. . It was the first insurance company to offer cash dividends to policy
owners. And has over 30,000 agents and employees worldwide.
HDFC Standard Life Insurance Company, even as it belongs to the December 2001
vintage when it and ICICI Prudential were the first to commence operations, is
placed at number three position. HDFC Standard Life has sold 32,000 policies
against 44,311 lives. On the business portfolio of Rs.1,266 crore, it has received a
premium income of Rs.36 crore. HDFC are the main shareholders in HDFC
Standard Life, with 81.4%, while Standard Life owns 18.6%. The ambition of
HDFC Standard Life is to mirror the success of the parent companies and be the
yardstick by which all other insurance company's in India are measured.
SBI Life Insurance Company Ltd. is a joint venture between India's largest bank,
State bank of India and Cardiff a leading Life Insurance company in France The
Company's authorized capital is Rs.250 crore, and the paid-up capital at present is
Rs.125 crore. SBI owns 74% of the total equity, and Cardiff the balance 26%.
The Life Insurance Corporation (LIC) was established about 44 years ago. Its main
asset is its staff strength of 1.24 lakh employees and 2,048 branches and over six
lakh agency force. LIC sold 2.32 crore policies in the fiscal 2002. The fiscal was
marked by a phenomenal growth rates for LIC as the number of policies sold shot
up by over 16%. The state player mopped up first premium income from new
policies sold to the extent of Rs.14,844 crore, a growth of 137% over its
performance last fiscal. This is over and above the regular yearly premium of
Rs.35,000 crore. At the same time, LIC has managed to grow its book by
underwriting an additional Rs.1,92,575.36 crore of fresh business. . It pays off
about Rs 6,000 crore annually to 5.6 million policyholders.
The industry estimates that private players have sold around 3 lakh policies in the
first year. Performance varies, as all the new players did not start out together. ING
Vysya Life for instance started just six months back. SBI Life on other hand had to
change its business plan as late as in the last quarter, since it could not leverage on
9000 strong network of State Bank of India. While its model is expected to revolve
around banc assurance, SBI Life today sells it's products through it's team of 1000
direct agent. Tata AIG Life and Non-like combined had sold over 5 lakh policies in
the first year. Birla Sun Life Insurance has written a business size of Rs.1,600
crore. OM Kotak Mahindra Life Insurance received 13,000 proposals in fiscal
2002 and mopped up Rs.13 crore on the proposals. The sum assured is more than
what meets its the expectations at Rs.350 crore.
It is not a number's game that the private insurance companies are after. Emphasis
is on good quality portfolio and building the blocks for a future growth. The first
year for the new players has been a learning curve, with the focus being on setting
up Capacities and Base. Here the tie-up with the international financial
conglomerate has come handy in setting up a sophisticated, hi-tech, professional
organization for starting the business
INTERNATIONAL COLLABORATION OF INDIAN
COMPANIES:
FOREIGN ENTITY LOCAL COMPANY/VENTURE
AIG Tata
Allianz Bajaj
AMP Sanmar
Aviva Life Dabur
Cardiff State Bank of India Life
ING Life Vysya
Max New York Life Vysya
MetLife J & K Bank, Pallonji Group & others
Old Mutual Kotak Mahindra
Prudential ICICI
Standard Life HDFC
Sun Life Birla
Life insurance has come a long way from the earlier days when it was originally
conceived as a risk covering medium for short periods of time, covering temporary
risk situations, such as sea voyages. As life insurance became more established, it
was realized what a useful tool it was for a number of situations, including
Temporary needs / threats
The original purpose of life insurance remains an important element, namely
providing for replacement of on death etc.
Regular savings
Providing for one’s family and one self, as a medium to long term exercise
(through a series of regular payment of premiums) this has become more relevant
in recent times as people seek financial independence for their family.
Investment
Put simply, the building up of savings while safeguarding it from ravages of
inflation. Unlike regular saving products, investment products are traditionally
regular investments, where the individual makes a one off payment.
Retirement
Provision for later years becomes increasingly necessary, especially in a changing
cultural and social environment. One can buy a suitable insurance policy, which
will provide periodical payments in one’s old age.
The liberalization followed by growth of the Indian Insurance industry has opened
wide opportunities for Service and Infrastructure sectors. This growth has to be
properly canalized. Some of the major challenges which have to be addressed for
canalizing the growth of insurance sector are Product Innovation, Distribution
Network, Customer Service and Education, Investment Management.
Product Innovation
Customers are now looking at Insurance as complete financial solution offering
stable returns coupled with total protection. There is a need to constantly innovate
in terms of product development to meet ever changing consumer needs.
Understanding the customer better will enable an Insurance company to design
appropriate products, determine price correctly and increase profitability. In this
context Management Guru Peter Drucker has rightly said "Markets are changing
from Cost lead Pricing to Price lead Costing".
Distribution Network
While companies have been successful in product innovation, most of them are
still grappling with right mix of Distribution Channels for:
This calls for Selection of right type of Distribution channel mix along with
prudent and efficient FOS (Fleet On Street) Management.
REVIEW OF LITERATURE
Mishra (1986) in his Ph.D. thesis on “Life Insurance Corporation of India” has
worked on objective to study the effect of working of LIC, how this effects the
financial level, and study the impact of LIC’s working on the internal organisation.
It was concluded that being the only company providing best services to the
customers by satisfying their needs, is running successfully by earning through
revenues and through providing remarkable services to the customers.
The main objective of the project was to check the preference of the customers
regarding the insurance policies of the life insurance sector
The objectives of the project were:
2 To know the perception of the customers for knowing that which factor
affects their policy purchase decision.
3 To know Government Life Insurance policies are much more secured than
their Private Life insurance policies.
NEED OF THE STUDY
1 It will help in getting the knowledge that which is the most important factor
in affecting the policy purchase decision, and company can emphasis on it
(like the agent’s training and CRM).
2 It will help in getting the knowledge that what new features and benefits
should be in a life insurance policy.
3 It will help in getting the knowledge that advertising is affecting the policy
purchase decision or not.
4 Is less premium affects policy purchase decision? This can be known by this
project.
RESEARCH METHODOLOGY
RESEARCH METHODOLOGY
1. Sampling design:
In this study life insurance companies are selected from both public and private
sectors .In this project 100 customer are surveyed which are deals with insurance
policies.
2. Research design
4. Data collection:
5. Data analysis:
Paucity of time could not allow a detailed study and thus the vast
information could not be included in the project report.
Study is limited to Shimla region only.
A. Yes B. No
36%
yes
no
64%
1 64% of the respondents are not interested in getting insured reason being
some of them was already insured and yet others do not want any insurance
cover.
2. What according to you is the most important reason for getting insured?
A. Risk Coverage
B. Savings
C. Tax Benefit
CHART 5: PURPOSE
23%
46%
RISKCOVERAGE
SAVINGS
TAX BANEFIT
31%
1 Majority of the respondent i.e. 46% says that the most important reason
while taking the life insurance policy is tax benefit as there life insurance
policy is exempted from tax.
2 31% respondents invest in life insurance policy for the purpose of savings.
3 The remaining respondents i.e. only 23% invest in life insurance policy for
the purpose of risk coverage.
3. How much of your annual income would you like to invest in life
insurance?
A. Up to 2, 500
B. 2,500 – 5,000
C. 5,000 – 20000
D. 20000-above
CHART 6: INVESTMENT
26% 4%
32%
UPTO 2500
38% 2500-5000
5000-20000
20000-ABOVE
Sample size – 100
1 38% respondents say that they invest between Rs. 2500 to Rs. 5000 in the
life insurance premium.
2 26% respondents say that they invest between Rs. 5000 to 20000 in the life
insurance premium.
3 32% respondents say that they invest up to Rs. 2500 in the life insurance
premium.
4. What factors should you consider when thinking about the amount of
life insurance?
B. Your Salary
C. Future needs.
D Others
CHART 7: FACTORS
5%
13%
39%
Benefits of
the plan
Your salary
Future needs
43%
Others
2 while 39% of them think that benefits of the plan must be the main priority
while deciding about the insurance amount.
3 And yet other i.e. the remaining 18% considers future needs or some other
factors as the basis for amount of insurance.
A. YES
B. NO
CHART 8: COVERAGE
34%
yes
No
66%
1 66% of the respondents say that they are covered under life insurance
schemes (out of them 80% belongs to LIC and rest of them are covered
under private sector) and 34% are not covered under any life insurance
scheme. So these 34% persons provides the opportunity to the insurance
companies.
2 Majority of people who are covered under life insurance are the one living in
urban areas and are the educated lots of society.
3 34% people who are not covered one probably investing their money in PF
and other long term & short-term schemes.
4 The reason for preferring LIC is people’s trust in government where as they
are of the view that private companies may vanish after a few years.
6. Who is your insurer?
A. LIC
B. Private Company
CHART 9: INSURER
LIC 89%
1 LIC holds major market share i.e. 89% as they have built customer’s trust.
2 Private players together cornered 11% of the market share in which ICICI
Prudential, Birla Sunlife, HDFC Standard Life, Tata AIG, Max New York Life
are the main players.
A. Colleagues
B. Friends
C. Family
D. Others
21% 20%
COLLEAGUES
FRIENDS
FAMILY
24%
35% OTHERS
2 24% of the respondent influenced by the family. So we can say family members
play an important role to influence for purchasing of the life insurance policies.
3 20% of the respondent influenced by their colleagues.
B. Parents
20%
childless single
person
80% parents
Sample Size - 100
1 80% of the respondents are of the view that parents are more likely to buy the
insurance policies, as they consider insurance as a risk-covering device to
protect their dependents.
2 Where as 20% of them are of the view that even singles are more likely
to buy insurance as their main motive is to save tax and save a lump sum.
9. Do you perceive that government life insurance policies are much more
secured than their private counter parts?
A. YES
B. NO
CHART 12:SECURITY
31% Yes
No
69%
1 69% Respondent feel that Govt. life insurance policies are more secured than
their private counterparts. Because the life insurance policies have with in the
market for a long time and a wider reach.
2 25% respondents feel that private counter parts are also secured. Among
other Govt. life insurance the premium rates are comparatively low. The
services are better as compare to govt. life insurance.
10. Do you go through all the details of the policy (Comparative and the
chosen) that you choose?
A. YES
B. NO
CHART 13: DETAILS
10%
Yes
No
90%
1 90% respondent says that they go through the details of the policy before
choosing the one. Because they are going to invest their money in that policy.
2 10% respondents says that they don’t go through the details of the policy
and that is because they are just buying the policy to evade the tax and that
people are rich and the premium hardly make any difference to them.
22% ENDOWMENT
12% CHILDREN
MONEY BACK
TERM ASSURANCE
8% PENSION
SINGLE PREMIUM
33%
1 Majority of the respondent are aware about the money back plan.
5 8% of the respondent is aware about the term assurance policy and single
premium plans.
12. Do you know about ICICI Prudential Life Insurance Co. Ltd.?
A. Yes
B. No
38%
yes
no
62%
1 62% respondents are aware of the ICICI Prudential Life Insurance Company
although some of them know it by ICICI Bank, others have partial
knowledge and yet others have full knowledge about the company.
2 38% of the respondents are not at all aware of the brand ICICI Prudential .
B. Agents
C. Print Media
D. Others
60
52
50
40 37
Electronic
30 24 Agents
Print
20 Others
11
10
0
1 52% people surveyed said that they are able to recall the advertisements of
the company in newspaper , magazines and other such print medias.
3 Only 24% people said that they knew about HDFC Standard Life through
Electronic media .The company seldom show any advertisements on the
electronic media but still people were aware of its campaign.
14. Life insurance policy should be made compulsory for every earning
individual.
A. Agree
B. Disagree
2%
AGREE
DISAGREE
98%
1 98% respondent says that life insurance policy should be made compulsory
as they can relate it to the benefits they set to the policy.
Life Insurance sector after privatization is maturing from mere security as single
purpose behind owning a policy to one of better investment options as well as
policies is available with multiple options and riders. Now at present around 13
private co’s are operating in life insurance sector. LIC is going to have tough time
ahead but due to its multiple policies and huge network of agents and strong client
base gives its competitive advantage. But real competition is coming from HDFC
AND ICICI which are utilizing competitively their old database in attracting
customers through cross-selling of financial products at one roof.
In the era of IT and telecom revolution through mobile commerce, net
services, bank assurance and easy availability of credit has given cut throat
competition in this sector. As a credence service it is very difficult for customers to
evaluate even after purchase and use of policies. Here, personal relations
maintained by insurance agents give you competitive edge. Relationship marketing
is advanced concept which is transformation of transaction marketing.
The distribution of whole life insurance sector seems to suggest relationship
marketing. It usually is sold by agent who is primary contact person and on whose
advice buyers rely in finding a suitable policy. After the sale agents provide
follow-up service, helping customers make policy changes in response to changing
needs.
After analyzing the data, there are many things which I found. The main findings
of my research are:
1 The main objective of my project was to check the awareness of people
regarding the private companies of Life Insurance.
2 In the comparison of other private Life Insurance companies the awareness
of ICICI Pru. and HDFCL is much more. After ICICI Pru. The next Life
Insurance Company which is known by people in HDFCSL. These two
companies are known by people due to their other previous operations in
India.
3 If we ask the question to the people that from which company he/she is
willing to buy LIP, then most of the people answered that they will purchase
LIP from LIC, due to its strong brand image and wide network. I reached a
conclusion that after some time and with the better performance and better
features products private Life Insurance Companies will be able to increase
their database.
4 In the comparison of other private life insurance companies, more people
give their preference to buy LIP from ICICI prudential and HDFCSL
Insurance Company, due to successful operation of ICICI Prudential and
HDFC in India.
5 If we see the reasons that why more people are willing to buy LIP from LIC.
I reached a conclusion that people give preference to LIC because it’s strong
brand image and wide network. The other reasons are that the people think
that their money is safe in the hand of LIC, and after completion the policy
the returns will be guaranteed.
RECOMMENDATION
INFORMATION BROCHURE
http//www.ing.com/ing/contentm.nsf/homeabout
httap://www.sanmargroup.com
Dasgupta, S. (2003, June 29) ICICI Prudential leads the New Life Pack. The
ICICI Prudential Life Insurance Ltd. (n.d.) Retrieved on (2004, Oct 25) From
http://.http://www.iciciprulife.com/creative/home.jsp(faq)
Introduction (n.d) Retrieved on (2004, Oct 25) From
http://www.bajajallianz.co.in/aboutus.htm
Kumar, A. (2003, March 5) Private Sectors Players eat into LIC Business.The
Hindustan Times-Chandigarh
Rangachary, N. (2003) Vision for the Future. Survey of Indian Industry 2003 p39-
41
Yes No
2. What according to you is the most important reason for getting insured?
Tax Benefit
3. How much of your annual income would you like to invest in life insurance?
4. What factors should you consider when thinking about the amount of life
insurance?
Yes No
Colleagues Friends
Family Others
9. Do you perceive that Government Life Insurance policies are much more
secured than their Private counterparts?
Yes No
10. Do you go through all the details of the Policy that you choose?
Yes No
12. Do you know about HDFC Standard Life Insurance Co. Ltd.?
Yes No
14. Life insurance should be made compulsory for every earning individual...
Agree Disagree
NAME: ________________________________________________
ADDRESS: _____________________________________________
EDUCATION: ___________________________________________
OCCUPATION: __________________________________________